The United States Agency for International Development (or USAID) is the US government organization responsible for most non-military foreign aid. An independent federal agency, it receives overall foreign policy guidance from the US Secretary of State.
It advances US foreign policy objectives by supporting:
- economic growth, agriculture and trade
- democracy, conflict prevention and humanitarian assistance
Marshall Plan reconstruction of Europe after World War Two and the Truman Administration's Point Four Program. In 1961, President John F. Kennedy signed the Foreign Assistance Act into law and by executive order established USAID.
At the Earth Summit in Rio de Janeiro in 1992, the world's governments adopted a program for action under the auspices of the United Nations–Agenda 21, which included an Official Development Assistance (ODA) aid target of 0.7% of gross national product (GNP) for rich nations, roughly 22 members of the OECD, known as the Development Assistance Committee (DAC).
However, US levels of foreign aid fall far short of this goal; the US currently ranks last among the world's wealthiest countries at about 0.1 percent of GNP. In absolute amounts, the United States is currently the world's top donor of economic aid, although for more than a decade it was second to Japan, which is far smaller and has been beset by economic woes. In 2001, the United States gave $10.9 billion, Japan $9.7 billion, Germany $4.9 billion, the United Kingdom $4.7 billion, and France $4.3 billion. As a percentage of GNP, however, the top donors were Denmark, Norway, the Netherlands, Luxembourg, and Sweden. The tiny Netherlands (pop. 5.3 million) gave $3.2 billion in 2001 — almost a third of what America contributed.
The 2003 budget of President Bush proposed $11.4 billion in foreign aid with an additional $4.3 billion for peacekeeping operations and to finance, train, and educate foreign armed forces.
USAID claims that "U.S. foreign assistance has always had the twofold purpose of furthering America's foreign policy interests in expanding democracy and free markets while improving the lives of the citizens of the developing world," but critics say that the US government more frequently gives aid to reward political and military partners than to advance genuine social or humanitarian causes abroad.